Study: Retail-based clinics a viable business for Walmart, other retailers, if managed correctly

By Antoinette Alexander

NEW YORK — Retail-based health clinics represent a viable business for retailers who locate and correctly manage them, according to Kalorama Information.

The healthcare market research publisher, which is a division of MarketResearch.com, made its assessment based on the recent news that Walmart may dramatically expand its retail clinics offering.

Walmart has denied that it is building a national, integrated, low-cost primary care healthcare platform; however, the retailer reportedly has not disputed that it is looking for new partners for its 140 clinics nationwide.

According to published reports, Walmart is looking to partner with outside healthcare companies to treat and manage a range of medical conditions — including HIV, diabetes, arthritis and clinical depression.

“While medical clinics locations are still relatively few in the U.S., the concept survived the recession and legislative challenges,” stated Bruce Carlson, publisher of Kalorama Information. “We’ve always felt our forecasts could be dramatically changed if a major retailer jumped in, and recent news suggests that may happen.”

Kalorama has completed three studies on the budding industry over the past five years and estimates in-store medical clinic sales at $733.4 million.

Several years ago, Walmart had announced as many as 400 medical clinics in its stores, but then shuttered some locations. Today, the retailer’s website lists approximately 140 Clinic at Walmart locations, which is just a fraction of all U.S. stores. However, this could change soon, as Walmart sent out a request-for-information document to strategic partners.

According to Kalorama, the retailer could benefit from tying new clinics into the store rather than keeping them as independent entities outside the main traffic zone.

“They can’t be seen the same as a travel agency, optometrist or Subway sandwich shop,” Carlson said. "Our research has found that retail clinics work best when connected to pharmacies, when supported by store management and when their success or failure is measured on indirect as well as direct revenue.”

Kalorama noted the success of retail clinics in pharmacies versus other locations. CVS’ MinuteClinic grew from 541 stores in 2009 to more than 560 in 2011. Meanwhile, Walgreens also embraced the concept and its Take Care Clinics have gone from 250 to approximately 330 in two years’ time.

Kalorama’s study indicated that such mass outlets as Walmart or Costco could gain at least $800 per day from indirect revenues — extra purchases made by customers who came to the store to receive primary care services.